Toyota Shaw vs CA

9 May 244 SCRA 320, G.R. No. L-116650 May 23,1995 FACTS: Private respondent Luna L. Sosa wanted to purchase a Toyota Lite Ace. With his his son, Gilbert, he went to the Toyota office at Shaw Boulevard, Pasig and met Popong Bernardo, a sales representative of Toyota. Sosa emphasized to Bernardo that he needed the Lite Ace not later than 17 June 1989. Bernardo assured him that a unit would be ready for pick up at 10:00 a.m. on that date. They contracted an agreement on the delivery of the unit and that the balance of the purchase price would be paid by credit financing through B.A. Finance. The next day, Sosa and Gilbert delivered the downpayment and met Bernardo who then accomplished a printed Vehicle Sales Proposal (VSP) in which the amount was filled-up but the spaces provided for Delivery Terms were not filled-up. However, on 17 June 1989, at 9:30 am, Bernardo called Gilbert to inform him that the car could not be delivered because nasulot ang unit ng ibang malakas. Toyota contends, on the other hand, that the Lite Ace was not delivered to Sosa because of the disapproval by B.A. Finance of the credit financing application of Sosa. Toyota then gave Sosa the option to purchase the unit by paying the full purchase price in cash but Sosa refused. Sosa asked that his down payment be refunded. Toyota did so on the very same day by issuing a Far East Bank check for the full amount, which Sosa signed with the reservation, without prejudice to our future claims for damages. Thereafter, Sosa sent two letters to Toyota. In the first letter, he demanded the refund of the down payment plus interest from the time he paid it. The second, he demanded one million pesos representing interest and damages, both with a warning that legal action would be taken if payment not paid. Toyotas refused to accede to the demands of Sosa. The latter filed with RTC a complaint against Toyota for damages under Articles 19 and 21 of the Civil Code. In its answer to the complaint, Toyota alleged that no sale was entered into between it and Sosa, that Bernardo had no authority to sign for and in its behalf. It alleged that the VSP did not state the date of delivery. ISSUE: Whether or not there was a perfected contract of sale. HELD: There was no perfected contract of sale. What is clear from the agreement signed by Sosa and Gilbert is not a contract of sale. No obligation on the part of Toyota to transfer ownership of a determinate thing to Sosa and no correlative obligation on the part of the latter to pay therefore a price certain appears therein. The provision on the down payment of PIOO,OOO.OO made no specific reference to a sale of a vehicle. If it was intended for a contract of sale, it could only refer to a sale on installment basis, as the VSP executed the following day con finned. Nothing was mentioned about the full purchase price and the manner the installments were to be paid. A definite agreement on the manner of payment of the price is an essential element in the formation of a binding and enforceable contract of sale. This is so because the agreement as to the manner of payment goes, into the price such that a disagreement on the manner of payment is tantamount to a failure to agree on the price. Definiteness as to the price is an essential element of a binding agreement to sell personal property. G.R. No. L-26572 March 28, 1969

MORALES DEVELOPMENT COMPANY, INC., petitioner, vs. THE COURT OF APPEALS and HERMENEGILDO DESEO and SOCORRO DESEO respondents. Alberto R. de Joya for petitioner. Francisco Mendioro for respondents. CONCEPCION, C.J.: Petitioner, Morales Development Co., Inc, hereafter referred to as Morales seeks the review on certiorari of a decision of the Court of Appeals reversing that of the Court of First Instance of the Province of Quezon.

Hermenegildo Deseo and Socorro Deseo, respondents herein and plaintiffs below, brought this action to annul a sale to Morales of lot No. 2488 of the Cadastral Survey of Catanauan, Province of Quezon, and to secure the registration of a deed of conveyance of said lot in their (Deseos') favor. Lot No. 2488 used to belong to Enrique P. Montinola and was covered by Transfer Certificate of Title No. T-15687 of the Register of Deeds of said province, in his name. Alleging that his owner's duplicate copy of said certificate had been lost, Montinola succeeded in securing, from the Court above mentioned, an order for the issuance of a second owner's duplicate, with which he managed to sell the lot, on September 24, 1954, to Pio Reyes. Upon registration of the deed of sale to the latter, said TCT No. T15687 was cancelled and, in lieu thereof, TCT No. 21036, in the name of Reyes, was issued on November 18, 1954, Lupo Abella, married to Felisa Aguilar hereafter referred to as the Abellas purchased the land from Reyes, whereupon the deed of conveyance, executed by Reyes, was registered and the Abellas got TCT No. 21037 in their name, upon cancellation of said TCT No. 21036. About seven (7) months later, or on June 16, 1955, the Abellas sold the land, for P7,000, of which P4,500 was then paid to the Deseos, who immediately took possession of the property. It appears, however, that the first owner's duplicate of TCT No. T-15687 was either never lost or subsequently found by Montinola, who, making use of it, mortgaged C, the lot in question, before February 21, 1956, to the Philippine National Bank, for P700. Then, on the date last mentioned, Montinola sold the property to Morales, for P2,000, from which the sum due to the Bank was deducted. Upon presentation of the deed of sale in favor of Morales, the latter was advised by the office of the Register of Deeds of Quezon that said TCT No. T-15687 had already been cancelled and the property sold, first, to Pio Reyes, and, then, to the Abellas. Thereupon, Morales filed a petition for the annulment and cancellation of the second owner's copy of TCT No. T-15687. After due notice to Reyes and the Abellas, but not to the Deseos, said petition was granted on March 12, 1956. Having been unable, in view of these developments, to register the deed of conveyance executed by the Abellas, the Deseos commenced, in the court aforementioned, the present action against Morales, for the annulment of the subsequent sale thereto by Montinola, and the registration of said deed of conveyance in their (Deseos) favor, alleging that the same enjoys preference over the sale to Morales, the Deseos having, prior thereto, bought lot No. 2488 in good faith and for value, and having been first in possession of said lot, likewise, in good faith. Upon the other hand, Morales claimed to have a better right upon the ground that it (Morales) had bought the property in good faith and for value, relying upon the first owner's duplicate copy of TCT No. T-15687, unlike the Deseos, whose predecessor in interest, Pio Reyes, had relied upon the second owner's duplicate, which Morales alleged had been secured fraudulently, and that the sale to Reyes and that made by the latter to the Abellas are null and void, because both sales took place under suspicious circumstances, so that Morales concluded they (Reyes and the Abellas) were not purchasers in good faith and for value. After appropriate proceedings, the court of first instance sustained the contention of Morales and rendered judgment in its favor, which, on appeal taken by the Deseos, was reversed by the Court of Appeals. The dispositive part of the latter's decision reads: WHEREFORE, the judgment appealed from is hereby reversed and another one entered in favor of the plaintiffs (Deseos) and against the defendant (Morales) declaring said plaintiffs to be the lawful and absolute owners of Lot No. 2489 of the Cadastral Survey of Catanauan, Quezon, covered by Transfer Certificate of Title No. T-21037 of the Office of the Register of Deeds of Quezon; declaring the deed of sale executed by Enrique P. Montinola in favor of defendant covering the same property as null and void; ordering the Register of Deeds of Quezon to register the deed of sale executed by the spouses Lupo Abella and Felisa Aguilar in favor of the plaintiffs dated June 16, 1955, marked Exhibit A, without cost, not having prayed for in the brief for the appellants. Hence, the present petition for review on certiorari by Morales, which insists that the Court of Appeals should have upheld its (Morales') contention adverted to above. We, however, find therein no merit. Morales maintains that the sale by Montinola to Reyes and that later made by Reyes to the Abellas are "suspicious"; that, consequently, Reyes and the Abellas were not purchasers in good faith and for value; and that these two (2) premises, in turn, lead to the conclusion that both sales are "null and void."

This syllogism is obviously faulty. The major premise thereof is based upon the fact that the consideration stated in the deeds of sale in favor of Reyes and the Abellas is P1.00. It is not unusual, however, in deeds of conveyance adhering to the Anglo-Saxon practice of stating that the consideration given is the sum of P1.00, although the actual consideration may have been much more. Moreover, assuming that said consideration of P1.00 is suspicious, this circumstance, alone, does not necessarily justify the inference that Reyes and the Abellas were not purchasers in good faith and for value. Neither does this inference warrant the conclusion that the sales were null and void ab initio. Indeed, bad faith and inadequacy of the monetary consideration do not render a conveyance inexistent, for the assignor's liberality may be sufficient cause for a valid contract 1 , whereas fraud or bad faith may render either rescissible or voidable although valid until annulled, a contract concerning an object certain, entered into with a cause and with the consent of the contracting parties, as in the case at bar. 2 What is more, the aforementioned conveyance may not be annulled, in the case at bar, inasmuch as Reyes and the Abellas are not parties therein. Upon the other hand, the Deseos had bought the land in question for value and in good faith, relying upon the transfer certificate of title in the name of their assignors, the Abellas. The sale by the latter to the former preceded the purchase made by Morales, by about eight (8) months, and the Deseos took immediate possession of the land, which was actually held by them at the time of its conveyance to Morales by Montinola, and is in the possession of the Deseos, up to the present. Then, again TCT No. T15687, in the name of Montinola, had been cancelled over a year before he sold the property to Morales, who, in turn, was informed of this fact, what it sought to register the deed of conveyance in its favor. It should be noted, also, that TCT No. 21037, in the name of the Abellas, on which the Deseos had relied in buying the lot in dispute, has not been ordered cancelled.lawphi1.et Since the object of this litigation is a registered land and the two (2) buyers thereof have so far been unable to register the deeds of conveyance in their respective favor, it follows that "the ownership" of said lot "pertain(s)" pursuant to Article 1544 of our Civil Code 3 to the Deseos, as the only party who took possession thereof in good faith. 4 Morales argues that it was not enough for the Deseos to have gone to the office of the Register of Deeds and found therein that there were no flaws in the title of the Abellas, and that the Deseos should have, also, ascertained why the Abellas had paid only P1.00 to Reyes, and why the latter had paid the same amount to Montinola. To begin with, the Deseos did not know that said sum was the consideration paid by the Abellas to Reyes and by Reyes to Montinola. Secondly, the Deseos were not bound to check the deeds of conveyance by Reyes to the Abellas, and by Montinola to Reyes. Having found that the owner's duplicate copy of TCT No. 21037, in the name of the Abellas, was a genuine copy of the original on file with the Office of the Register of Deeds, the Deseos were fully justified in relying upon said TCT No. 21037, and had no legal obligation to make farther investigation. Thirdly, were we to adopt the process of reasoning advocated by Morales, the result would still be adverse thereto. Indeed, if it were not sufficient for the Deseos to verify in said office the genuineness of the owner's duplicate of TCT No. 21037, much less would Morales have been justified in relying upon Montinola's copy of TCT No, T-15687 in his name. In fact, had Morales, at least gone to the Office of the Register of Deeds as the Deseos did before purchasing the property in dispute, Morales would have found out, not only that TCT No. T-15687 had long been cancelled, but, also, that the property had been previously sold by Montinola to Reyes and by Reyes to the Abellas. In short, the negligence of Morales was the proximate cause of the resulting wrong, and, hence, Morales should be the party to suffer its consequences. 5 WHEREFORE, the appealed decision of the Court of Appeals should be, as it is hereby affirmed, with costs against petitioner herein, Morales Development Company, Inc. It is so ordered. Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Fernando, Capistrano, Teehankee and Barredo, JJ., concur.

MELLIZA vs. CITY OF ILOILO (1968)Sales Part 3 of Outline (Subject Matter) 1. Julian Melliza during her lifetime owned, 3 parcels or residential land in Iloilo City. (Lots 2,5, and 1214). Total area of Lot 1214 was 29, 073 sq. meters. 2. Julian Meliiza donated to the Municipality of Iloilo 9,000 sq. meters of Lot 1214 to serve assite for the municipal hall. The donation was however revoked because of inadequacy tomeet the requirements of the Arellano Plan. 3. Subsequently ,Lot 124 was divided to A and B. Still later, B was further subdivided into 1,2, 3. Lot 1214B-1 (4,563 sq. m) became as Lot 1214-B; Lot 1214-B-2 (6,653 sq. m)became as Lot 1214-C; Lot 1214-B3 (4,135 sq. m) became Lot 1214-D 4.Julian Melliza sold her remaining interest to Remedios Villanueva who acquired title to theland. Villanueva transferred her rights to the portion of the land to Pio Sian Melliza whoalso obtained title. But there was annotation at the back of Pios certificate that: a. (a) that a portion of 10,788 square meters of Lot 1214 now designated as LotsNos. 1214-B-2 and 1214-B3 of the subdivision plan belongs to the Municipality of Iloilo as per instrument dated November 15, 1932.... 5. On August 24, 1949 the City of Iloilo, which succeeded to the Municipality of Iloilo,donated the city hall site together with the building thereon, to the University of thePhilippines (Iloilo branch). The site donated consisted of Lots Nos. 1214-B, 1214-C and1214-D, with a total area of 15,350 square meters, more or less. 6. Sometime in 1952, the University of the Philippines enclosed the site donated with a wirefence. Pio Sian Melliza thereupon made representations, thru his lawyer, with the cityauthorities for payment of the value of the lot (Lot 1214-B). No recovery was obtained,because as alleged by plaintiff, the City did not have funds7.On December 10, 1955 Pio Sian Melliza filed an action in the Court of First Instance of Iloilo against Iloilo City and the University of the Philippines for recovery of Lot 1214-B orof its value. 8. CFI: dismissed complaint of Pio Melliza; instrument already executed by Melliza included inthe conveyance of Lot 1214-B.9 . C a : a f f i r m e d C F I d e c i s i o n Issue: whether or not the conveyance by Juliana Melliza to Iloilo municipality included that portionof Lot 1214 known as Lot 1214-B.HELD: 1. It should be stressed, also, that the sale to Remedios Sian Villanueva from which PioSian Melliza derived title did not specifically designate Lot 1214-B, but only such portions of Lot 1214 as were not included in the previous sale to Iloilo municipality (Stipulation of Facts, par. 5, Record on Appeal, p. 23). And thus, if said Lot 1214-B hadbeen included in the prior conveyance to Iloilo municipality, then it was excluded from thesale to Remedios Sian Villanueva and, later, to Pio Sian Melliza.Issue: true intention of the parties 1. First of all, there is no question that the paramount intention of the parties was to provideIloilo municipality with lots sufficient or adequate in area for the construction of the IloiloCity hall site, with its avenues and parks. For this matter, a previous donation for thispurpose between the same parties was revoked by them, because of inadequacy of thearea of the lot donated. 2. Secondly, reading the public instrument in toto , with special reference to the paragraphsdescribing the lots included in the sale, shows that said instrument describes four parcelsof land by their lot numbers and area; and then it goes on to further describe, not onlythose lots already mentioned, but the lots object of the sale, by stating that said lots arethe ones needed for the construction of the city hall site, avenues and parks according tothe Arellano plan . If the parties intended merely to cover the specified lots Lots 2, 5,1214-C and 1214-D, there would scarcely have been any need for the next paragraph,since these lots are already plainly and very clearly described by their respective lotnumber and area. 3. The requirement of the law that a sale must have for its object a determinate thing, isfulfilled as long as, at the time the contract is entered into, the object of the sale iscapable of being made determinate without the necessity of a new or further agreementbetween the parties (Art. 1273, old Civil Code; Art. 1460, New

Civil Code). The specificmention of some of the lots plus the statement that the lots object of the sale are the onesneeded for city hall site, avenues and parks, according to the Arellano plan , sufficientlyprovides a basis, as of the time of the execution of the contract, for rendering determinatesaid lots without the need of a new and further agreement of the parties.4.Furthermore, Pio Sian Melliza, from the stipulation of facts, was the notary public of the public instrument. As such, he was aware of its terms. Said instrument was also registeredwith the Register of Deeds and such registration was annotated at the back of thecorresponding title certificate of Juliana Melliza. From these stipulated facts, it can beinferred that Pio Sian Melliza knew of the aforesaid terms of the instrument or ischargeable with knowledge of them; that knowing so, he should have examined theArellano plan in relation to the public instrument Exhibit "D"; that, furthermore, he should have taken notice of the possession first by the Municipality of Iloilo, then by the City of Iloilo and later by the University of the Philippines of Lot 1214-B as part of the city hall siteconveyed under that public instrument, and raised proper objections thereto if it was hisposition that the same was not included in the same. 5. The fact remains that, instead, for twenty long years , Pio Sian Melliza and hispredecessors-in-interest, did not object to said possession, nor exercise any act of possession over Lot 1214-B. Applying, therefore, principles of civil law, as well as laches,estoppel, and equity, said lot must necessarily be deemed included in the conveyance infavor of Iloilo municipality, now Iloilo City